WASHINGTON — The value of business inventories in March was roughly unchanged, below the 0.1% gain expected by analysts and the MNI calculated prediction, data released by the Commerce Department Tuesday morning showed.
Retail inventories decreased 0.5%, revised down from the advance estimate of a 0.4% decline and the largest dip since September. Data from the wholesale inventory report showed a 0.3% rise in the month, which was down from the 0.5% gain expected in the advance report, while factory inventories were up 0.3%.
As a result of the downward adjustment to both retail and wholesale inventories from the advance data used for the first estimate of first quarter GDP, there is a chance of a downward adjustment to the business inventories category when the second estimate of GDP is released on May 30.
According to an MNI calculation, if a 1.1% decrease in motor vehicle inventories had been excluded, business inventories would have been up 0.2% in the month. The decrease in motor vehicles was revised down from the 1.0% decline in the advance estimate.
After excluding the decrease for motor vehicle inventories, the remaining retail categories would have posted a 0.1% decline, unrevised from the advance estimate. There were declines in every published category except a 0.3% increase in inventories of building materials and garden supplies.
According to an MNI calculation, the unpublished retail categories were up 0.2% following a 0.5% decrease in February, helping to offset the declines in the other retail categories.
March business sales posted a 0.5% gain, the same as in the previous month.
Retail sales excluding food services rose 0.7% in March, as reported earlier Tuesday, while factory shipments, which are equal to sales in this report, rose 0.4% and wholesale sales rose 0.3%.
Due to the flat reading for business inventories and the 0.5% gain in sales in the month, the inventory-to-sales ratio fell to 1.34 in March from 1.35 in February. The ratio remains well below the 1.38 level seen in March 2017, as sales have continued to outpace inventory growth over the last year.
